Exhibit 10(c)(7)
AGREEMENT OF EARLY RETIREMENT
This Agreement made this 23rd day of December, 1998 between Xxxxx X.
Xxxxx ("Xxxxx") and Xxxxxx Products, Inc., a Delaware corporation ("Company") at
Des Plaines, Illinois.
The Company has proposed and Xxxxx desires to accept the proposal for
early retirement effective with the close of business on December 31, 1998 on
the terms, conditions and in accordance with the provisions as set forth herein.
Xxxxx has since December, 1971 served the Company in various capacities
including, but not limited to, Director, corporate officer and President and has
been directly involved in the creation, acquisition and operation of many
aspects of the business of the Company and of its subsidiaries within the United
States and in foreign countries.
In consideration of the premises hereof and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged by
the parties hereto, the parties hereby agree as follows:
1. Effective January 1, 1999, Xxxxx will relinquish his duties and
responsibilities and retire from the offices of President and Chief Operating
Officer of Xxxxxx Products, Inc. (Delaware), as a member of the Executive
Committee of Xxxxxx Products, Inc. (Delaware), and as an officer of those of its
subsidiaries of which he is an officer and as a director of those subsidiaries
of which he is a director. Xxxxx will continue to serve as a member of the Board
of Directors of Company until otherwise determined by himself, the Board of
Directors or the shareholders of Company.
2. Salary. Xxxxx'x current annualized salary of Three Hundred Seven
Thousand One Hundred Nine Dollars ($307,109) per year will continue to be paid
until June 30, 2003 (Salary Continuation Period).
3. During the Salary Continuation Period and at all times thereafter, Xxxxx
will not disclose to any person, firm or entity whatsoever any information
relating to the Company or its or their customers or any trade secrets of any of
them of which he became or may become aware during his employment with the
Company or at any time thereafter.
4. Xxxxx covenants that until two years after the later to occur of (a) the
expiration of the Salary Continuation Period, and (b) the date on which Xxxxx is
no longer a member of the Board of Directors of the Company ("Prohibited
Period"), Xxxxx will not, without the written permission of the Board of
Directors of Company, which may be withheld for any reason, directly or
indirectly, individually or in combination with others with respect to any other
company or entity carrying on a business similar to that of the Company or any
of its subsidiaries as it or they may exist during the Prohibited Period:
(a) hold or deal in the share or other interest of any such company or
entity which is privately owned; or
(b) hold or deal in (except for investment purposes only, and in such
event, not to exceed 1% of the outstanding shares of such company or
entity) the shares or other interest of any such company or entity which is
publicly owned.
5. Xxxxx covenants that until two years after the later to occur of (a) the
expiration of the Salary Continuation Period, and (b) the date on which Xxxxx is
no longer a member of the Board of Directors of the Company ("Prohibited
Period"), he will not, directly or indirectly, carry on for himself or be
associated in any capacity with any business, company or entity, the business of
which competes with that of the Company or any of its subsidiaries (as it or
they may exist during the Prohibited Period) with respect to the products
handled or the customers sold or both and he will not engage in any activities
which will be detrimental or contrary to the best interest of the Company or any
of its subsidiaries. Inasmuch as the Company and certain of its subsidiaries
operate their respective businesses throughout the United States and in certain
foreign countries, the restriction herein contained shall apply throughout the
United States and in such foreign countries in which the Company or its
subsidiaries or affiliates are or may from time to time during the Prohibited
Period be seeking orders for or selling merchandise, whether directly or through
its agents or representatives.
6. Xxxxx further covenants and agrees that in the event of a breach or
violation on his part of any of the above covenants that (a) any monies due or
to become due to Xxxxx from Company hereunder or otherwise shall thereupon be no
longer due or payable and all obligations of Company to make such payments shall
be void; (b) all benefits to be provided to Xxxxx by Company hereunder shall
cease; and (c) a suit in equity may be instituted to obtain an injunction and
that a temporary restraining order may be granted immediately upon the
commencement of any such suit without notice. This remedy is in addition to any
other remedies, legal or equitable, which may be available to the Company.
7. Health Insurance. During the Salary Continuation Period, Xxxxx shall be
entitled to continue his participation in the group health insurance program
under which he was covered immediately prior to the Retirement Date if in effect
and if not, he may participate in any such plan then in effect in accordance
with its terms; provided, however, that to continue his participation in any
such program, Xxxxx shall be responsible throughout the Salary Continuation
Period for paying the same monthly premiums and costs as he would otherwise have
been responsible for had he remained in Xxxxxx'x employ during such period.
8. Medicare Coverage. On June 22, 2003, Xxxxx will become Medicare eligible
and all coverage under the Company's medical plan (as may be in force from time
to time) will cease. Effective that date, Xxxxx will have the option of
enrolling in the Medicare Supplement and Prescription Plan as may then be in
effect and in accordance with its terms. If Xxxxx enrolls in the Medicare
Supplement and Prescription Plan, Xxxxx will pay the premium cost to the
insurance company as long as he participates in the Plan.
9. Dental Insurance. During the Salary Continuation Period, Xxxxx shall be
entitled to continue his participation in the dental insurance program under
which he was covered immediately prior to the Retirement Date if in effect and
if not, he may participate in any such plan then in effect in accordance with
its terms; provided, however, that to continue his participation in such
program, Xxxxx shall be responsible throughout the Salary Continuation Period
for paying the same monthly premiums and costs as he would otherwise have been
responsible for had he remained in the Company's employ during such period.
10. Retiree Spouse Coverage. During the Salary Continuation Period, Xxxxx'x
spouse will be permitted to participate in the health and dental insurance
programs under which she was covered immediately prior to Xxxxx'x Retirement
Date if in effect and if not, in any such programs as may then be in effect in
accordance with the terms of any such plan. On the date Xxxxx reaches the age of
65 and is Medicare eligible, his spouse, if not yet 65, will be entitled to
participate in continued coverage of any such plan then in effect, if any, until
the earlier of (a) the expiration of a period of five (5) years or (b) until she
attains the age of 65. The Company will contribute its portion (as provided in
such program then in effect, if any) of the cost of the premium at the rate in
effect at the time coverage is elected. Xxxxx will have the election of adding
his spouse to the medicare supplement insurance, at his cost, when his spouse
attains the age of sixty-five (65) to the extent permitted by such insurance, if
any.
11. Executive Deferral Plan. During the Salary Continuation Period, Xxxxx
may continue, at his election, to remain a participant in the Company's
Executive Salary Deferral Plan. If Xxxxx elects not to continue as a plan
participant during the Salary Continuation Period, the distribution of benefits
will begin at the time of such election; otherwise, the distribution of benefits
will commence after June 30, 2003 in accordance with the payment options
permitted by this Plan as they may exist at such time.
12. Profit Sharing. Xxxxx will be considered an active plan participant for
the 1998 Profit Sharing Plan Year. From and after January 1, 1999, he will not
be considered an active plan participant for any purpose and any amounts
remaining in his Profit Sharing Plan Account will be treated as provided in the
Profit Sharing Plan, as amended from time to time. Distributions of funds from
Xxxxx'x Profit Sharing Plan Account shall be in conformance with IRS regulations
and the provisions of the Profit Sharing Plan, as amended from time to time.
13. Airline Travel. The Company presently has a contract with American
Airlines and until the earlier of (a) the expiration of the period the contract
remains in force, (b) the expiration of the Salary Continuation Period, or (c)
the date Xxxxx is no longer a member of the Board of Directors of the Company,
Xxxxx will continue to receive his current level of benefits to the extent
permitted by the said contract, if any: (1) "Platinum" status for Xxxxx; (2)
"Admirals Club" Membership; and (3) Xxxxx will be allowed to purchase airline
tickets through the Company which will be charged to his personal credit card.
14. Life Insurance. Subject to the last sentence of this paragraph, during
the Salary Continuation Period, Xxxxx will be entitled to the Company paid Life
Insurance benefit of $50,000 and the Travel & Accident Insurance benefit of
$300,000 limited to the extent such benefits are offered by the Company from
time to time. Additionally and subject to the last sentence of this paragraph,
Xxxxx may continue participation in the Supplemental Life Insurance and Spouse
Life Insurance benefit programs limited to the extent such benefits are offered
by the Company from time to time. Xxxxx shall be responsible throughout the
Salary Continuation Period for paying the same monthly premiums for himself and
his wife as he would otherwise have been responsible for had he remained in the
Company's employ during such period.
15. Executive Physical. Until the earlier of (a) the expiration of the
Salary Continuation Period, or (b) the date Xxxxx is no longer a member of the
Board of Directors of the Company, Xxxxx will be entitled to the Company paid
Executive Physical, annually until June 30, 2003.
16. This Agreement supersedes that certain Employment Agreement dated July
17, 1972 by and between Xxxxx and Xxxxxx Products, Inc. and is intended to
survive any management change or any sale or divestiture of the Company.
XXXXXX PRODUCTS, INC.
a Delaware corporation
By: /s/ Xxxxxxx Xxxxxx /s/ Xxxxx X. Xxxxx
Its Chairman & CEO Xxxxx X. Xxxxx
